Public spending efficiency in the countries of the gulf cooperation council

Abstract

PurposeThe Gulf Cooperation Council (GCC) countries have been increasingly investing in their economic and social development in recent years, yet the effectiveness of their spending remains unknown although they have been taking reforms to advance their spending efficiency practices.Design/methodology/approachThe study applies a quantitative approach to analyze panel data using a multiple regression model based on the World Economic Forum (WEF) reports of the global competitiveness index (GCI) from 2009 until 2018.FindingsThe results show that policies' strength has a positive and significant influence, while national infrastructure and workforce empowerment have a negative and significant influence over the extent of spending efficiency implementation in the GCC countries.Research limitations/implicationsGCI disclosure assessment criteria changed in 2019 and then stopped in 2020 due to COVID-19. A different version of GCI was published in 2020, which focuses on recovering from the COVID-19 pandemic, and no other issues have been published since then. This represented a barrier to recent data collection.Practical implicationsPractical contribution is the value added by this study to a minimal literature on spending efficiency in the GCC countries. This study’s theoretical contribution to knowledge is the integration of the new institutional sociology (NIS) perspective of institutional theory and the resource slack theory to investigate a set of factors rarely explored in relation to their impact on governmental spending efficiency.Social implicationsThis study provides the following recommendations for policymakers: The GCC government should direct government training bodies and universities (in business majors) to include mandatory spending efficiency subjects to enhance current knowledge. Also, the governmental-related bodies of spending efficiency should make agreements with universities and research centers to improve the diverse R&D aspects of government spending efficiency. Another important recommendation is to enforce the adoption of the GRC concept regarding spending efficiency practices for governmental employees to guide them towards implementing spending efficiency practices.Originality/valueThis study's theoretical contribution to knowledge is the integration of the new institutional sociology (NIS) perspective of institutional theory and the resource slack theory to investigate a set of factors rarely explored in relation to their impact on governmental spending efficiency. Also, the practical contribution is the value added by this study to a minimal literature on spending efficiency in the GCC countries. The research has established empirical evidence to support the findings above.